PETALING JAYA: Shareholders of ISF Group Bhd could potentially see a dividend declared for the second half of financial year 2026 (2H26) as analysts reckon the group will remain favourable in the next six to 12 months.
In a report, CGS International (CGSI) Research noted that ISF Group has continued to benefit from the domestic-driven thematic data centre (DC) stage two upcycle.
“ISF Group indicated that it may consider declaring dividends in 2H26, a pleasant news, as we have assumed a 30% net payout ratio for the financial year of 2026 (FY26) or 0.98 sen dividends per share (RM9.8mil total payout), yielding 1.3% at the current price,” it said.
According to the research house, the specialised water and wastewater engineering contractor could potentially win larger valued scopes supporting its RM150mil target total wins in FY26.
“There is a fair chance that ISF Group will exceed its FY26 total win target of RM150mil, as it anticipates a revival in higher-value DC awards.
“Its expansion into new DC turnkey contractor clients serving US-based hyper-scalers will also benefit it,” CGSI Research said.
It’s worth noting that ISF Group views 2H26 as a critical period for DC piping system awards to pick up in momentum, in line with the recent trends observed for other successful mechanical and engineering players serving the DC space.
CGSI Research said as a result, ISF Group could have a further upside to end- June 2026’s outstanding order book of RM157.4mil, and higher tender conversion potential of its tender book of RM557mil.
It said it will reiterate an “add” call on ISF Group with a higher target price of RM0.95 from RM0.80 previously.
